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  • the case
German court rules in favor of U.S. contractors.

Finance court says Germany must return any taxes payed.
  • The final decision

Letter to the Editor Stars & Stripes:

I am delighted to advise that there was a highly favorable outcome in the tax trial in Neustadt.

The case involving John Adair vs. the Kaiserslautern Finanzamt has now been clearly and firmly decided in John Adair's favor.

The K-Town Finanzamt will be required to return the $300k that Mr. Adair was required to pay in taxes...plus the Finanzamt must also, under German law, pay 6% interest for each year that it held the money. (The sweetener is that no taxes are payable on any of these funds to include the interest.)

My favorite German lawyer (Mr. Detlev Albrecht) has now set a precedent which was reportedly described by one local official as "a black day for German taxation."

Mr. Albrecht was alone in the court while there were 8 lawyers and tax officials representing the Kaiserslautern Finanzamt.

A key element was the notion that length of time in Germany should not play into any decision to tax...and also that Article X was being interpreted too liberally by the Finanzamt.

Mr. Albrecht advised that several U.S. military & civilian lawyers were in the court to include senior representatives from USAREUR and USAFE. There were also two reporters from Stars & Stripes.

A clear precedent has definitively been set and I would expect any law-abiding DOD contractor with TESA certification to be reasonably protected from German taxation. However, I am sure there will be other cases...and each will need to be judged on its own merits.

My hat is off to Mr. Albrecht who has served U.S. interests above and beyond what one might expect from the German legal and taxation systems.

I expect we'll be hearing more about this later...but, for now, I'm delighted we can finally put one in the win column.

                                                                                                  Joseph Theodore Page Jr., Böblingen

And regarding another tax-case:

Congratulations, Mr. Albrecht!

... and you certainly do deserve being referred to as the best Tax Lawyer in the State of Rhineland-Palatinate!

Renate and I are very proud of you. We shall never forget what you have done for us. We feel very grateful to you. And we must think of it every day.

As of the hearing of November 11, 2010, we were doomed to die.

We know very well that it has been nothing but your very intervention to which we owe our two old lives. It has been your generous help and your valuable advice. God bless you and your dear wife! 

                                                                                                       Dietrich Felgner & Renate Steiner

Links:

These websites once again show the randomness to the process and all the misinterpretations/misconceptions that are out there.

http://en.allexperts.com/q/German-Law-1364/2010/2/Income-tax-SOFA-Status.htm

http://www.toytowngermany.com/lofi/index.php/t135504.html

http://www.toytowngermany.com/lofi/index.php/t145962.html

http://www.eur.army.mil/g1/content/CPD/docper.html

Please visit as well our next page:

TESA / SOFA